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tv   Squawk Alley  CNBC  September 2, 2015 11:00am-12:01pm EDT

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they were looking for a number around 220,000. >> let's send it over to "squawk alley." thanks, guys. 8:00 a.m. at apple headquarters in cupertino, california. 11:00 a.m. on wall street and "squawk alley" is live. ♪ welcome to "squawk alley." joining us today, john steinberg, ceo of "the daily mail" north america. jon fortt is back tomorrow and kayla tausche is here. the dow was up 200-plus as oil
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getting inventory numbers up 4.7 million barrels around half an hour ago that brought oil and equities lower. comes one day after all the major averages fell close to 3%. i wonder in your circles if managers, ceos are starting to get -- i don't want to say comfortable, but used to the volatility we're seeing over the last ten days? >> it isn't really the volatility. it's really the stock market and main street and regular business. when i was saying to kayla before we came on, every conversation i have with every executive team, whether they're in lodging, media, or food, is in massive flux right now. every major industry you think of is going through so much transition and i think that creates a lot of insecurity, a lot of concern and having the stock market further in this kind of insecure territory compounds that. it's a time when no one knows which way is up. >> but advertising is something that companies view as nice to have but not completely necessary. it's something that they spend on when times feel really good. and given you're talking to people who are managing the
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pursestrings for companies across a variety of sectors, are you seeing any sentiment impact there this. >> theoretically, wall street should not impact ceos. on the periphery, there is some concern. but there is such a one-time shift from traditional media to digital that that should ideally outstrip any insecurity that would result in a pullback of marketing spend. >> we have made our way through a lot of data today. we got adp, slightly light but looking relatively solid as we get the jobs number coming up on friday. productivity, beige book is this afternoon, mortgage app. getting breaking news on both hulu and steven spielberg today. >> hulu is offering a commercial-free subscription option for $4 more than the current subscription which includes commercials, though
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fewer than the number of ads on television. hulu which is owned by disney, fox and nbc universal has been making a big push to expand its contact. just monday announcing it's shifting away from its focus on television to make a multi-year deal with epix. this puts hulu into direct competition with netflix as well as amazon prime streaming as hulu's media giant parent look to hedge against ad dollars. shifting gears over to steven spielberg, sources telling me he is looking to part ways with disney when his company, dreamworks studios, distribution deal expires in august of 2016. hollywood reporter said this morning he's in talks with universal. but my sources tell me that it's too preliminary to say his talks with universal or any more advanced than they are with other studios and that spielberg is talking with all the other players to figure out where to take his distribution deal next
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year. but my sources do say it would make sense for spielberg to make a deal with universal, largely because he's so invested in the studio already thanks to his jurassic park franchise which is at disney. a reboot of that franchise, he's also an adviser on all the jurassic park rides. his offices are where our cnbc offices are as well. and he was seen having lunch with ryan meyer, the ceo of universal pictures, about once a month here in the commissary. a partnership there could make a lot of sense but it's too soon to say where he will take his deal next year. >> julia, if you see him in the commissary, tell him to come home because that relationship goes all the way back to "jaws" and "sugarland express," it would be nice to have him. >> the relationship does go back very far. but he's been in various other
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studios including paramount, now disney. >> julia boorstin in l.a. with a great story today. walking back a little bit of what thr is saying today. >> i like the idea of her in the commissary hiding behind the buffet. >> this story is so much more interesting to me than the hulu story. the platform itself is almost irrelevant. the content is all that matters. could spielberg do a great set of series that people need on any given platform? absolutely. that's why the content is so much more valuable. we have breaking news that the new apple tv will have universal search built in with siri. so you could say, give me the new spielberg show and it will just pull it up, further making the notion of networks and who's providing the content irrelevant. >> let's move to apple. shares in the green after a rough day yesterday amid all this market volatility, stocks still in correction territory, negative for the year, down
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about 17% from the highs back in april. here's mark andreessen. take a listen to this. >> one way of interpreting what's happening to apple, apple is trading at about a tenth the value that it should be at this point in time. that's an expression of risk aversion and the fear that apple investors have that the company will fall off a cliff at any moment. >> a tenth of what it deserves. >> i'll let nick talk about his "vanity fair" article when he's on. but what i will say about apple -- i was a booster of the watch. i said the watch would be great. the watch numbers were solid that came out for apple. number two compared to fitbit right now. and we have them coming out possibly to do talks in content. a major play in ads by doing ad-blocking and the only way to get ads on ios. a lot of moves coming from apple right now. >> but you think about china. that's been the source of
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growth, the source of people saying that will be a bigger market than the u.s. for apple. the consumption economy there, the growth of the middle class, they will be able to overcome what tim cook has called these near-term speed bumps. and couple that with a little bit of distraction from music, from possible moves into tv, trying to get more entrenched in payments. what do you see the company's growth coming from? >> i think they're looking for big growth areas and they're finding them. fitbit is a $6 billion company. i think they'll surpass them. and this tv thing they're doing is going to be dramatic. they're coming out with this box now. they'll shortly be out with a bundle which will be a television replacement. it's a $600 billion company that's finding growth areas right now. it's hard to criticize that. >> reed hastings on cnn saying it's not that big a deal that apple would be getting into original content because so many others are in the same business that weren't in that business two years ago.
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does apple pose a greater threat than yahoo! or amazon? >> the greatest threat, netflix and hulu and these other places don't matter anymore. there's no reason why i couldn't start watching something on hbo. i do. that's the bigger threat. there are so many hundreds of hours being produced right now. the question is, it's just going to disperse everybody's revenue. >> who sets the price on this? hulu is saying, pay $7.99 a month for our product but you still have to swallow at least two commercials each show. >> i think the advertising market is setting it. google had a pilot called google contributor where people could pay to not see ads. and hulu is saying, for no ad load, the prspread is basically $4. the advertising market is in some ways setting what the price is for these services. >> the reported price for apple's skinny bundle, bloomberg reported $40. >> yes.
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>> is that too cheap? >> depends on what's in it ultimately. but i don't think it will be too cheap. apple has historically been tough. sometimes too tough and gotten themselves in trouble with the government. how do you deliver this for $40? what's going in it. >> good time to be a producer or agent right now, so many places to sell your wares. >> yes. and is it a good time or is there so much competition that the market is becoming saturated right now. but we're seeing a shift from platforms to content because the platforms are all built out and the content is the way to get the engagement. i think facebook will be a very big player here. i don't see how they couldn't go in. we were going to talk about the nfl stuff. the nfl -- that thursday night game is coming up for bid. why not facebook or someone else? >> and cbs says, don't count us out. and i love the piece about gm when they dissed facebook early
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on in the ipo process. >> their ceo saying she had a conversation with sheryl sandberg. taking a playbook from a lot of these ceos that are active on social. being the marketing and voice of the company. >> interesting what sheryl sandberg shared was her post on linkedin. >> we're all family. andreessen is one of the main topics in nick bilton's article in "vanity fair." coming up, we'll talk to a top investor who says this pullback makes him feel like a kid in a candy store. . a top official from calpers is here to talk with us.
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u.s. equities have been rebounding after losing some steam following crude inventories. the tech sector is leading the way, up nearly 1%. this morning, the dow is now up 132 points. joining us now, wedgwood partners chief investment officer david roth. good to see you. >> good to be back. >> and it's nice to have a day
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of relative stability in the markets. seems we get this when we're able to see china out of the headlines. how sustainable is that? >> i don't think it's going to be too sustainable. listen, we're not in 2012 or 2013 or 2014 anymore. we're finally seeing downside volatility. and i think we'll see it for the rest of the year. but finally we're getting some downside volatility and some stocks are getting pretty darn cheap. >> do you see the market resetting itself for another leg higher or do you think that the market has reset itself because this is the fair valuation? >> i think we're still in the midst of resetting. i'm in the camp that believes that the shiller p/e and the 50-year highs of the median s&p stock, stock market valuations as a percent of gdp, i'm in the camp that all that matters and that valuations got too high. and we've had an incredible
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six-year bull run maybe through -- i guess the s&p recent high was back in may. i think we need a good correction. i think we're in the midst of one. but there are a lot of stocks that have corrected more than the major indices. so we're starting to get a little giddy at wedgwood picking up some bargains. >> now you're getting to the real question. 42% of the nas 100 already in bear market, 20% off the highs. how cheap does it need to get before you truly get interested? do you need to see 50% drops in some of these names? we've already got that in some areas of tech. >> right. we only own about 20 stocks. our top three holdings are berkshire, apple and our third largest holding is probably the most hated tech stock out there and that's qualcomm. and those shares have been just decimated. so you're right. there are some bargains out there. thank goodness we only populate a portfolio of 20 stocks. >> why do you feel so comfortable getting into a name
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like qualcomm, david, which you mention is one of the most hated stocks because it gets so much of its revenue from china? >> well, again, i'm from missouri. qualcomm's the ultimate show-me stock right now. everything that could have gone wrong for qualcomm over the past 12 to 18 months has in fact gone wrong. but we believe we've seen the worst of the revenue decline, we've seen the worst of the margin declines. and i think as qualcomm -- as we go into next year, as they rebound that margin structure and they get close to that $5 earning handle again, i think you can see at least $70 on the stock if not maybe $80 a share over the next 18 to 24 months. with the dividend, that's almost a 50% increase over the next two years. we love the risk/reward of qualcomm down here, recognizing all of the past troubles they've had over the past 12 to 18 months. >> interesting, though, your biggest holding is berkshire hathaway. is that just a general
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broad-based play on the american recovery and the american economy? >> not necessarily. it's born of valuation. if you squint a little bit, you can make the case that the book value per share, we own the "b" shares, may be approaching $105, maybe $110 a share. the "b" shares are $130 a share. you're buying the stock right now a little more than 1.3 times book. and the old man buffett himself said at 1.2 times book he'd be a buyer in size himself. it's rare you get berkshire this cheap. . it's a solid grower. it's going to be a gdp-plus grower. rare you get it this cheap. >> one last question on that, david. we've heard from other investors who thought the pcp deal was too rich. obviously will be dealing with succession issues so long as
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buffett is with us. he leveraged himself in rails where coal is in a difficult spot, people are less impressed than they used to be. you're not in that camp? >> no, i'm not. those are real concerns. the burlington deal when it was first announced seemed a little expensive. the pcp deal, maybe on the high side in terms of expense. when buffett is looking out three to five years, it's not going to be that expensive. but, yeah, i'll concede your point. it's not the cheapest stock or company buffett's ever bought. >> finally, david, before we go, we're trying to parse bill gross's monthly outlook which came out this morning. he says cash or better yet near cash like one to two-year corporate bonds are my best idea of appropriate risk/reward. is that too conservative? what do you say to that? >> no, i don't think so. we've been in this q.e. environment for five or six years. and the markets have been feeding off that $4.5 trillion q.e. balance sheet.
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i think we're going to have a hangover. so i don't disagree with what bill gross wrote this morning. i read it on the way into the studio. i think he makes very cogent points. >> but yet you are buying some of these dips and some of these names. we'll see how it plays out. >> absolutely, thank you. >> we appreciate it. up next, many speaking out against bank of america's proposal to allow brian moynahan to continue as both chairman and ceo, including analyst mike mayo. >> they're not hearing the shareholders. bank of america, shareholders have spoken up, can we please hear your response. >> one of those shareholders who has been speaking out, a top official at calpers, will join us in just a moment. plus we are still watching the markets close to the highs. dow up 150 points. s&p up 0.75%. nasdaq up 1%. the next big driver for today's action, the close in europe. we'll bring to it you on the
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other side of this break. "squawk alley" will be back in a moment. care of my heart.
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two of the country's largest pension funds, calpers and calsters are coming out swinging against bank of america saying they oppose brian moynihan being allowed to stay on as chairman and ceo. ann, great to have you with us. we saw mike mayo describe in a large-than-life fashion, the fact that shareholders are not being listened to. as a shareholder, what are your feelings? >> really, this is a very disappointing move by bank of america. they had a clear vote in 2009 that shareholders, including calpers, including calsters, was
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still there, were still part owners of this country. we said we wanted independent oversight of management. that hasn't changed. what the board did was decide without talking to shareholders to combine the rolls again. in other words, they flew in the face of that vote. so really this plan they're coming back with is really subpar and we'll be voting against it. >> anne, i'm curious. we've got management shake-ups over there, the failed stress tests, we've had the error in the capital calculation. have they given you a good reason why this should happen? >> no, there is no good reason. here's why. capitalism is structured to give the owners of companies a vote on certain key things. and there was a vote to introduce an independent chair for good reason, to make sure we've got proper objective oversight of management. that is still needed at bank of america. we don't see any change in the good reason for independent
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oversight. what the board chose to do without coming back to its owners was say, oh, we've changed our mind, we're going to recombine these roles and give brian moynihan two jobs. one is a supervisory role of himself. that's a conflict of interest we're not comfortable with. we want an independent chair. shareholders in the majority agreed when it was put to the vote in 2009. also it was a binding vote. it wasn't a "would you please kindly do this?" we insisted it be done. so in good faith, the could be should be coming down saying an up-or-down vote, independent chairman? and they're playing fast and loose with the rules. that's not sporting. >> of course, this is all leading us to a vote on september 22nd.
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it's been viewed largely by shareholders as the bank's asking for forgiveness rather than permission for the situation that you just described. i'm wondering since putting your letter out yesterday, have you heard from any shareholders who share your view? >> well, we've been talking with our fellow owners. the letter that we've written was jointly signed with calsters which of course is the second biggest fund in the country. it's the largest educator fund in the world. and calpers and calsters, we're very happy to be out in front on this issue. and the issue is not just, should there be the independent chair. we think there's a good reason for that. this is about, should shareholder votes prevail? imagine you're in a sporting game and one side wins. they get the winning goal. and then the other side says,
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no, no, no, we've decided that that wasn't a win, we're going to count the result differently. the principle of abiding by binding shareholder vote -- this is really important to the whole of the corporate governance structure in the united states or in any market. if you have a vote and it's binding, you should jolly well follow that vote. the owners have spoken. they spoke with great clarity. follow that vote. if you want to change it, fine, come back. come back and say, we want to do something different. but they've muddled it up by saying, we may have an independent chair or we may have a new director. and that's not cricket, as we say where i'm from. >> sporting, jolly and cricket references -- >> yes, it's an international discussion all around. >> we'll learn how this turns out in a few short weeks. we appreciate your perspective from calpers.
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>> thank you very much. >> ann simpson, head of the governance program at calpers. if you looked at the stock 600 as an index, we're up about 0.3%. but essentially it's a flat to positive day after the very violent selloff that we witnessed yesterday, of course, in europe. it's interesting that some of the energy stocks have continued to fall as brent moves lower, below $49 a warl. this is a mishmash of oil majors in some of the oil and gas services stock. but it's a sector that clearly is in negative territory. the miners are also real interesting at the moment. some of them have bounced back since yesterday. but glencore continues to fall to record lows. they have announced they're opting to pay back $350 million of bonds. the earliest opportunity that they can, presumably to show their liquidity. this is in an environment where -- i had a note here from
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bank of america/merrill lynch from jason faircluf on monday that asked, how much do the miners need to recapitalize? and they say it's $50 billion to $60 billion. and those who do it early will have an advantage. that seems to have attached itself, right or wrong, the possibility of a capital increase. it's one reason why they're in negative territory. moving on -- this is coming out of the stocks 50, by the way, the 50 blue-chips in europe. the italian banks in general are doing well. i can't find a reason for this. but it is important that we're on the eve of the ecb meeting. and there's been a lot of discussion about whether or not the ecb will be forced to verbally intervene to say, we may at some point extend q.e.
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beyond 2016, september of next year, or alternatively we may double down on the amount that we buy. these are reasons why rbs thinks they won't move tomorrow, although they do think they will move further down the line. let's mention where we are on the bund. this is crazy. the bund continues to sell off. the yield on the ten-year is up to 80 basis points, a move of about 25 basis points in a week and a half, leading some to question why that is and whether we're in "q" tightening as we've discussed. >> big day tomorrow. >> ecb. we'll see if he verbally intervenes. the way rbs lays it out, unlikely at this meeting. >> we'll see what happens in the morning. when we come back, a new piece in this month's "vanity fair" from nick bilton called "is silicon valley in another bubble and what could burst it." nick joins us to answer that question when we come back. you focus on making great burgers, or building the best houses in town.
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good morning, everyone. i'm sue herera and here is your cnbc news update at this hour. senator barbara mikulski says she will vote in favor of the iran deal. giving obama a major foreign policy victory. a white house staffer has been indicted on assault and other charges after a dispute with a capitol police officer last month.
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the woman grabbed the officer's weapon and fired it when he came to her home for a reported shooting that was filed. at least ten people were killed and scores injured by a car bomb blast in western syria. a coastal stronghold of president bashar al assad. footage shows burning vehicles in an area littered with the wreckage of numerous cars demolished by the force of that blast. another tough day for new york city commuters. signal problems calling major delays on the long island rail road, affecting thousands. one woman said she simply gave up and went home after waiting for two hours. it's still an 80-minute delay on mass transit in new york city. that's your cnbc news update this hour. let's hope that gets better. back to "squawk alley." if you're looking for a sign of a tech bubble, just read this, a new piece for "vanity fair," nick bilton asks, is silicon valley in another bubble and what could burst it? nick writes the bubble signs are out there and are, quote,
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increasingly ubiquitous. here to explain it all is nick bilton, also a cnbc contributor. good morning. good to see you again. >> good to see you. >> you come at this from a number of angles. you look at the competition, at real estate, at architecture. but my favorite line is that most of the start-ups in your words are glorified distribution companies trying to copy what domino's mastered in the '80s. can you expand on that? >> if you look -- there's a paragraph in the piece where i kind of go through a list of all these start-ups that are trying to do these food delivery kind of things, munchery and all this -- blue apron, gobble. and they have hundreds of millions of dollars in funding and what they're essentially trying to do is get food to your house in a reasonable amount of time which is what domino's pizza managed to do in the 1980s. i think that they're doing it and it's kind of similar in some respects to the cosmos of the
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'99 bubble. and the difference everyone says is, oh, we have mobile phones now. but the thing that is the same is there are still human beings bringing that stuff to your house, which to me seems unsustainable one of the other things i talk about in the piece that's related to that is a company called instacart, considered a "unicorn." when they were doing their last round of funding, they wouldn't let investors take the deck home with them. they couldn't take anything with them. and some investors i spoke with said that was very unusual and it felt like it was a little bit playing fast and loose with the numbers. >> not the first time you've tried to address the issue of a bubble since you moved out there years ago. is the reaction to this piece any different than it was in 2011, 2012? >> yeah. what's really interesting is when i kind of questioned it in 2011 and 2012, that was partially because of a company called path, which was drastically overvalued, people
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were pouring money into it, a lot of people were questioning it. and i said, is this the very beginning of this? and people came at me, called me every name in the book. a lot of venture capitalists did, too. in this one, i've been getting a lot of votes saying, i think this is pretty spot-on. a lot of people are worried that this is looking very frothy. one of the funny things, when i was writing the article, it took me a couple of months of reporting to do this piece. one of the lines in there was naming how many unicorns there were. every single time we went through on edit of the piece, the number has grown by five, six, seven unicorns. these are billion-dollar companies. in a couple of weeks, we're adding more and more to the books. doesn't seem to add up to me. >> you mentioned path which might be an example of the era we live in but yet it was able to find a company to acquire it just this may. and there seems to be a sense that so long as venture capitalists have enough trends to buy the companies that don't become the next facebook, we'll all be okay.
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what's wrong with that? >> well, that's a really good point. but who's going to -- when you're worth a billion dollars, you have a few different options. you can go public, great. if you can pull it off. but when you go public, you have to make sure that your balance sheets look great and the stock market is going to be interested because if they're not, you're going to see what happened to zynga and other companies like that. that's your first option. your other is to stay private, which is going to be incredibly difficult if you're at that valuation, you have to kind of continue to grow your employees and so on. but the last option is to sell. and so there are only really four companies that could buy you, the apples, the googles and facebooks and so on. they're not going to buy all of these unicorns. what i say will happen is we'll have some unicorpses, essentially dead unicorns and i think we'll start to see a few of those in the next 12 months or so. >> you reference andreessen specifically who as you note has
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publicly said -- i guess it's different this time because software, in his words, continues to eat the world. has he responded to this and why do you think he's wrong? why not the possibility that he's right about this one? >> what i think is that he's right and that he's wrong. i think mark is incredibly intelligent. he knows what he's talking about. but it's not a winner-takes-all with everything. i think that there are -- everyone is running so quickly to get involved -- all these venture capitalists are running so quickly to get involved in the next big twitter or facebook or whatever it is that i think they're investing sometimes in some of the wrong things. i think as a result, there will be companies -- i say this in the article -- we rely today on google and facebook and apple and all these companies. and they are not going anywhere. there are other companies, uber, for example, they may be overvalued but that company is not going anywhere. when you look at that in juxtaposition with some of these
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instacarts and these food delivery things and other start-ups that are clearly drastically, drastically overvalued, there's going to be some sort of correction. i don't think that -- one of the things i say at the end of the piece is we don't know if this is going to pop like it did in '99, if it's going to be a slow correction where some companies are going to be worth half what they are today. we don't know what it is. but i think it's going to be something in the middle. >> if nothing else, nick, the behavior has been just alarming. you describe an interest club for facebook's and instagram's party with the 600-pound tiger. the fact that a lot of these engineers have agents. is there any behavioral froth that you think is the most telling about where we are? >> the behavioral stuff is mind-blowing to me. there was a group of people on facebook, the first 250 employees they had, a facebook group where they talked about things they wanted to buy that were -- once they became uber rich, for example, islands and
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paintings worth millions of dollars. that's one thing. the other thing is the parties. back in the '90s, people wanted to outdo each other. there were parties i remember attending where there were flame-throwers and people spend $100,000 just on the drinks. but one of the things that's the most telling is the compensation. people -- you have i think the average i say in the article employee compensation is $192,000 for an engineer. interns are paid more than $75,000 a year. that's interns. the median household income is $54,000 a year. and then when you look at that and you look at the compensation from stocks on top of that, google last year paid one of their engineers that was going to leave and go to facebook $100 million not to go. i think these numbers just to me were the ones that made me scratch my head the most in all of the reporting i did. >> you'll agree that these are
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sort of contextural details. >> that's true. i spoke with one gentleman who's been monitoring this stuff for 30 years. he said that you can never predict when this is going to happen. and his prediction is we're around the 1998, 1997, 1999 era if you compare it to the last bubble. so we could still have a couple of years of this. it's just a matter of how high can it go. >> nick, it's a good read. everyone should and will read it. thank you so much. good to see you again. the article will appear in the october issue of "vanity fair" but you can read it now at coming up, content is king. but it's the delivery that is key. we'll speak with tom lleyton on how his company is helping big names get their content to consumers. but first, rick santelli, what are you watching today? >> kayla, we're going to watch
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the relationship between equities and the fixed income market. it's morphing a bit. is it temporary? and finally, china, jean-claude trichet today said something about china and central bankers and central planners that shocked me. you want to know what it was? you'll have to tune in after the break.
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coming up, are we close to a bottom? we get predictions from our experts. from gopro to disney to wynn, we get the calls. and one strategist says it's time to go overweight energy. see you in about 15. now over to the cme group, rick santelli has the "santelli exchange." rick? >> thank you. the relationship between market rates, treasuries, i'm putting a very short end off to the side because it has a lot of moving parts that are very closely associated with the federal reserve and what the fomc committee may do. but when it comes to the market rates that are traded even though there are definitely hostage securities on balance sheets of central banks all around the world, the mold was cast. i've said this before in 1987. the only hedge for a dropping stock market is buying
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treasuries which created at the time a relationship that really has been as pavlovian as anything i've seen in the stock market. but a funny thing has happened in this kind of prenormalization ether world we now live in with regard specifically to the u.s. going in a different direction than many other central banks. let's look at a dax chart, the german stock market. you see that direction. now look at bund yields from the same time, august 1st. i'm not sure if this relationship is morphing to the point where it's just a recalibration like everything else or is this a new normal? because it will be very significant, especially if central banks are basically doing different things at different times on different time lines. the next point is, jean-claude trichet talking about china today. i questioned him as to the notion of the importance of china's slowing, who's going to make up the growth.
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but his answer about china's slowing, i was a bit surprised. let's show it on the screen. he said, well, first of all, i would say that we knew -- we, i was talking about central bankers and central planners. that's the "we." we knew for a long period of time, of course, that the chinese growth would slow down. now, if that's the case and the "we" -- i would think the community of jean-claude trichets and ben bernankes and janet yellen and stan fischers, it's a small community. they understand what's going on in each other's minds. but the impact of that statement brings me to one point, what they know and when they knew it. if they knew china was slowing and they knew we were in the long end of the tooth on the business cycle and you have slippage in many economies, most recently canada, why would the fed have waited so long? you can argue all day long that
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the recent data doesn't justify a tightening. but in the new normal world, and that was the most correct assumption back years ago, that in the new normal with 2% growth, it's hard to justify zero interest rate. but knowing what they knew about china, why did they wait so long? i wish somebody could answer that question. carl, back to you. >> rick santelli, that was a great interview. thanks so much. when we come back, looking for a way to invest in apple without actually buying the stock? our next guest's company could be one way to do it. we'll explain with the dow up 121. [ male announcer ] we know they're out there. you can't always see them. but it's our job to find them. the answers. the solutions. the innovations. all waiting to help us build something better. something more amazing. a safer, cleaner, brighter future.
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at boeing, that's what building something better is all about. ♪
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with apple's next event days away, rumors of the company's exploring content creation, updates are swirling. as the big content delivery player, they're no stranger to delivering content to over-the-top devices, but could next week mean a big payback for the future? john joins us here at post nine, which is a real treat. welcome. >> thank you very much. >> starting with apple, it would be a big windfall for you. is it a real windfall that is out there for you? >> well, apple's been a longtime customer and partner. you know, i think it's interesting what various people are talking about with the possibilities of over-the-top
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media, and it would be exciting to see how that works out. >> so no comment specifically on whether this is something app ll do in the future. >> we'll have to see what apple decides to do. there is question about things coming online. >> buying your stock is basically buying an option for good. >> we do a lot of delivery over the top, over the internet. that's exciting for us. we're doing greater capacity and functionality to make the experience be wonderful for end users. >> you delivered march madness for espn last year. we heard bob say eventually espn will be a stand alone product. how popular is it for espn and otherstandalones.
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>> i think a lot of people are wondering. i think there's a lot of excitement. there could be a lot of adoption. that will create a lot of traffic on the internet. >> what needs to be done in terms of your own innovation and your own capex? what does that look like going two or three years out? >> certainly there's capex and we've increased ours to be ready for the demand there but certainly it's about the quality and making it fantastic. we're used to five nines on broadcast tv? >> broadcast ratios? what do you mean five nines? >> reliability. you turn on your tv and it works. it works and it's good quality. doing this on the internet is a lot harder than people think, so we're making a lot of investment to make that picture be a great. >> where buffering becomes a thing of the past? >> yeah. you don't want any buffering and you want really high-quality video as well, which is a whole
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difference gamegame when you go digital over the internet. >> you want to be faster and higher quality but you always want it to be secure. >> absolutely. sometimes people don't think about that, but as you see now, all the things being stolen online and the imemploy indications of that are very bad, so that's the fastest growing business at akamai. >> i saw something one of your interviewees said. four customers were targeted last year. that looks like a shocking headline number, but is that just the way we do business now? seven a target? >> it is. you know, the number of attacks doubled over the last year, more than doubled. the sophistication is increasing. you have nation states, organized crime, large political organizations. they've all made major innovations in attacking the
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large cyber structure and you have to fight back. that's where we put a lot of our money. i don't think that solves the problem. you have to solve it through technology and that's the way we're going about it. >> tom, we appreciate you being here. >> thank you very much. >> tom leighton is the co-founder of akamai. >> the big move chrk we'll talk about in a minute. no student's ever photographed mean ms. colegrove. but your dell 2-in-1 laptop gives you the spunk for an unsanctioned selfie. that's that new gear feeling. all laptops on sale, save $230 on this dell 2-in-1. office depot officemax. gear up for school. gear up for great. i take prilosec otc each morning for my frequent heartburn. because it gives me... zero heartburn!
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cbs announcing it will live stream two nfl game this year, making them available for free without a cable subscription. the games will be the new york jets against the miami dolphinsed on october 4 and the panthers versus the cowboys on november 26. cbs will stream four playoff games and super bowl 50. this morning they called it a shot of google's bow saying don't get any cute ideas because we know our way around here. >> and yahoo! is streaming its own game that will be the nfl played out of london. the jets game in october will be london game as well. that seems to be the way they're tiptoeing their way into this. >> we talked about the integral
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way of streaming cob tent in this day and age. we now the house of cards premier gives net fliks some trouble. imagine what the nfl will be like. >> yes. the network will have to maintain something quite large. >> let's get back to the judge who's back in the half. ♪ >> thank you so much. our game plan looks like this today. the energy play. why one big firm says now's the time to buy even though oil goes on one wild ride. calls of the day from disney, gopro and some of big-time moves from some popular ones today. we continue with stocks continuing to rebound this hour. off the highs, though, investors


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